More government is not a good file-sharing preventativeMarriage of peer-to-peer networks and digital rights management is a better solution

WASHINGTON - Recent controversies over file-sharing and copyright policy have spawned hot debate in the courts and the halls of Congress, but a study issued today by the Cato Institute argues that government interference in Peer-to-Peer (P2P) networks would hinder technological evolution. A better solution, according to the report, would be for government to step aside and allow the market to find a solution through digital rights management (DRM).

"By preserving property rights made possible through new market techniques, DRM encourages producers to innovate because they are more certain of an eventual reward," the authors argue. As evidence, they offer the case of iTunes, Apple's pay-per-download music service that launched in 2003. "The percentage of U.S. downloaders who actually paid for a song at one point or another increased from 8 percent to 22 percent in the first 12 months after the launch of iTunes," they write.

Einhorn and Rosenblatt argue that these market operations are greatly preferable to government technology controls or mandatory compulsory licensing schemes for both producers and consumers. They write that "an overly protective system of copyright is a detriment in the eyes of consumers who have grown accustomed to a range of copying capabilities, legally fair or not."

Ultimately, the authors conclude that "the government should act to protect property rights, including copyrights, but it should not pick winners or discourage any technology from competing in the new marketplace."

Einhorn is author of Media, Technology, and Copyright: Integrating Law and Economics. Rosenblatt is president of GiantSteps Media Technology Strategies.

The Cato Institute is a nonpartisan public policy research foundation dedicated to broadening policy debate consistent with the traditional American principles of individual liberty, limited government, free markets, and peace.

Topics Related to 'More Government is not a Good P2P File Sharing preventative'

More government is not a good file-sharing preventativeMarriage of peer-to-peer networks and digital rights management is a better solution

WASHINGTON - Recent controversies over file-sharing and copyright policy have spawned hot debate in the courts and the halls of Congress, but a study issued today by the Cato Institute argues that government interference in Peer-to-Peer (P2P) networks would hinder technological evolution. A better solution, according to the report, would be for government to step aside and allow the market to find a solution through digital rights management (DRM).

"By preserving property rights made possible through new market techniques, DRM encourages producers to innovate because they are more certain of an eventual reward," the authors argue. As evidence, they offer the case of iTunes, Apple's pay-per-download music service that launched in 2003. "The percentage of U.S. downloaders who actually paid for a song at one point or another increased from 8 percent to 22 percent in the first 12 months after the launch of iTunes," they write.

Einhorn and Rosenblatt argue that these market operations are greatly preferable to government technology controls or mandatory compulsory licensing schemes for both producers and consumers. They write that "an overly protective system of copyright is a detriment in the eyes of consumers who have grown accustomed to a range of copying capabilities, legally fair or not."

Ultimately, the authors conclude that "the government should act to protect property rights, including copyrights, but it should not pick winners or discourage any technology from competing in the new marketplace."

Einhorn is author of Media, Technology, and Copyright: Integrating Law and Economics. Rosenblatt is president of GiantSteps Media Technology Strategies.

The Cato Institute is a nonpartisan public policy research foundation dedicated to broadening policy debate consistent with the traditional American principles of individual liberty, limited government, free markets, and peace.